Here is a quote from Steven Malanga in the Dec. 31, 2011, edition of the Wall Street Journal:

“For two decades, America’s convention center business has been declining, resulting in a nationwide surplus of empty meeting facilities, struggling convention halls and vacant hotel rooms. How have governments responded to this glut? By building more convention centers, of course, financed by debt backed by new taxes and fees on already struggling taxpayers.”

In the Sunday Oregonian from Sept. 16, Eliot Njus calls it a “convention center hotel arms race” as Portland debates its own headquarters hotel; no one seems to be able to escape the fact that in a city with a thriving lodging environment, building a headquarters hotel is still robbing Peter to pay Paul.

Is there really enough convention business to go around? Apparently not. Here are some of the current losers in a quick Google search:

In Baltimore, the convention hotel experienced four consecutive years of losses while convention business was declining. One bond issue associated with this project is currently rated with negative prospects for repayment.

In Lancaster, Pa., authorities are considering redirecting hotel tax revenues away from the visitor’s bureau to cover interest costs on their hotel. There are also problems with the $833 million convention center in Washington, D.C.

Broward County, a well-known coastal Florida playground, has been struggling with this debate for years and has yet to reach a conclusion about building a convention center hotel.

The National Center of Policy Analysis, a public policy research organization, cites Amanda Erickson of Atlantic City in “Is it Time to Stop Building Convention Centers?” Erickson points out that the number of conventions and attendees has actually fallen in the United States over the last 10 years, and the glut is putting many of the publicly funded facilities at risk of default.

Malanga, a senior fellow at the Manhattan Institute, in “Convention Wisdom” in City Journal offers real numbers: Attendance in 2010 was 86 million, down from 126 million in 2001.

This really is a white elephant for our region, and while most other hotels are built with private funding, the developers of these things want you and me to pay for part of it or back it with tax dollars while they take the profit from construction and the managing hotel chain extracts a healthy fee for running the place.

Municipal bond financing deserves some explanation for those of us not familiar with the mechanics. There are two fundamental ways municipalities can issue bonds: The most secure is called a general obligation bond, or GO.

The bonds are backed by the full faith and credit of the issuer and the authority of that municipality to tax its citizens in order to retire the debt. Water and sewer, school districts, hospital authorities and municipal improvements all fall into this category.

The debt service and retirement of revenue bonds are dependent on the stream of revenue expected from the project and can be complicated by other potential guarantees on the issuing authority to make them attractive to investors.

This type of bond would likely be used to finance the Savannah Grand White Elephant Hotel. Needless to say, the failure of the hotel would be a severe black eye on the region’s overall credit worthiness.

The city and county seem to have a Christmas list of conflicting mythical projects this year. One group is off on a junket to South Bend to look at a baseball stadium we don’t need.

How is it in Britain they still revere a 100-year-old soccer venue for their top teams, but in historic Savannah we need a new minor league baseball stadium. The 1926 Grayson Stadium should be a matter of local pride.

Another political body sees the necessity of upgrading the Civic Center but instead now floats the idea of a new one. Neither will let this convention hotel fantasy just fade away.

The time and energy spent on finding additional tourism tax revenues might be better spent looking at projects such as attracting a cruise line (ca-ching) and building a Hutchinson Island terminal to support it, not to mention sound stages and skilled jobs, before that idea becomes a white elephant itself.

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The most interesting but absent point in the question of the convention venues and related hotels is the often cozy relations between the elected (and nonelected) local officials and the private entities who pitch these expensive projects. Buyer beware!